Amazon Fire Phone Not Doing Well As Q3 Numbers Released

By Anthony Jones | Small Business

Amazon Fire Phone Not Doing Well As Q3 Numbers Released

In June, Amazon decided to dive into the smartphone market with the Amazon Fire. The Amazon Fire phone features a quad-core processor, an Adreno 339 graphics processor, 2GB of RAM, and a slick design with Gorilla Glass covering all sides of the phone. Its Dynamic Perspective feature supports 3D images, and Fire OS, Amazon’s version of Android, was to be a huge hit.

Amazon had high hopes for the new product as they introduced the phone with a huge press conference and many advertisements. But Amazon’s U.S. phone market share came in at less than 1% in the third quarter, according to an IDC rep.

Amazon’s ambition for their first phone was so high that they priced the Amazon Fire phone at the same level as established competitors. Amazon realized their mistake, and they have already begun making changes, starting with a price cut from $199 to $0.99 with a contract.

In October, Amazon “took a $170 million charge of unsold Fire phone inventory.” David Limp, Amazon Senior Vice President of Devices, says that there’s another $83 million surplus of Amazon Fire phones. “We didn’t get the price right. I think people come to expect a great value, and we sort of mismatched expectations. We thought we had it right. But we’re also willing to say, ‘we missed.’ And so we corrected.”

Days after the Amazon Fire’s reveal in June, a Forbes article predicted the Amazon Fire phone would fail. The four reasons listed were the high phone price – which Amazon has now fixed – the heaviness of the device, fewer applications offered, and the lack of differentiation. “The Amazon Fire Phone is definitely lacking a “wow factor,” failing to capture the imagination of the general public.”

If Amazon wishes to compete in the smartphone market, they will have to develop a strategy that will turn things around. If not, the Fire could soon join the Facebook Phone in the box of failed ideas.